Ask Rande 10,000+
- Rande
- Katrina75
- oneputt
- Rande
- Rande
- Karin_
- Rande
- Karin_
- Rande
- Rande
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» Rande - Re: Locking Mortgage Interest Rates
In response to message posted by Katrina75:Kat,
It's impossible to predict over that time period what might happen. The Fed could ease again on 11/6, but who knows whether the bond market will react favorably or negatively after the fact? I agree with Kirk that anything under 7% on a non-conforming loan looks good, especially with no points. If rates come down later on enough that it makes sense and you're able to refinance then you can always go for it then. In the meantime, you've got a decent rate.
-- posted by Rande
» oneputt - SEP-IRA contributions
Rande,I found this comment while surfing around. I was wondering if you know if the 25% number he quotes for SEP-IRA's is correct?
Thanks
A couple months back I posted a question, having heard that new SEP-IRA contributions limits for year 2002
were increasing from 15% to 25% of adjusted gross income. I had much difficulty verifying this, even with my CPA, who finally after researching my query and much to his surprise, yesterday confirmed that indeed SEP-IRA contribution limits are increasing to 25% starting in 2002. Bully for the government helping the working man and woman reach their rtirement goals. It is a little like Christmas, financially speaking
-- posted by oneputt
» Rande - Re: SEP-IRA contributions
In response to message posted by oneputt:oneputt,
It’s true that as of 2002, the deduction for profit-sharing contributions may be 25% of pay, up from 15%. Some reports have indicated that SEP contribution limits also will rise from 15% of pay in 2001 to 25% of pay in 2002. Those reports, however, may be misleading. The new tax law contains what is perceived by many to be a glitch when it comes to SEPs. One section of the code was changed, permitting deductible contributions up to 25%. However, another section of the code wasn't changed, so that contributions over 15% will be taxable to the employee. Unless there's a technical correction, an employer could contribute 25% of pay and take a deduction, but the last 10% would be taxable income to the employee, which defeats the purpose. My guess is that such a technical correction would be forthcoming, but as the law now reads SEPs face a practical limit of 15% of compensation. In 2002, the compensation cap for calculating retirement plan contributions will rise from $170,000 to $200,000, so the maximum SEP contribution at 15% will be $30,000 under current law.
-- posted by Rande
» Rande - Re: Re: SEP-IRA contributions
In response to message posted by Rande:Should amend that last sentence:
In 2002, the compensation cap for calculating retirement plan contributions will rise from $170,000 to $200,000, so the maximum SEP contribution at 15% will be $30,000 under current law.
The way the law now reads, the maximum contribution would be 25%, but only 15% would be exempt from taxation. Again, have to believe that a technical correction will be issued to fix the discrepancy (it's not unusual for such technical corrections to be issued after the fact when the initial legislation is found to be flawed -- an indication of how complex the Code has become when even those who make a career out of crafting such laws miss a thing or two now and then), but for now the law is the law.
-- posted by Rande
» Karin_ - Rande
I have a sizable portfolio in Treasury Notes(Treasury Direct) staggered in 2- 4- 5 year notes.
As these notes are coming due now, I have received only 2.75% interest on a 2-year Note.
Do you know of any better way to invest this money, where I get a better return and still not take a big risk of losing my principal?
-- posted by Karin_
» Rande - Re: Rande
In response to message posted by Karin_:
Karin,
You can do better than that currently with I-Bonds, but that only solves a small portion of your problem given the $30K annual investment limitation (though you could do another $30K in January). Those seeking ultimate safety of principal are just going to have to live with lower rates.
-- posted by Rande
» Rande - Re: Re: Re: Rande
In response to message posted by Karin_:
Karin,
Are you referring to I-Bonds? They are state-tax free. Not only that, unlike Treasury Notes which pay a semi-annual coupon, you can allow the interest income to accumulate tax-deferred for federal purposes until you eventually cash in the bonds. Of course, the deferral doesn't help if you need the current income.
-- posted by Rande
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